About dividends on shares of PJSC MGTS. About dividends on shares of PJSC MGTS For ordinary securities

The MGTS company disclosed financial statements under RAS for the first three months of 2017.

The company's revenue decreased by almost 1% - to 9.7 billion rubles. Revenues in the main area - communication services - decreased by 2.6% to 6.75 billion rubles. What caused the decline is unknown, since MGTS does not disclose such information in its quarterly reports.

Separately, it is worth mentioning the reasons that influenced the structure of the company’s revenue in 2016 and became known after the disclosure of the company’s financial statements under IFRS, as well as the release of the report of the parent company MTS in SEC Form 20-F. Let us recall that the total revenue of MGTS in 2016 amounted to 39.5 billion rubles and did not change compared to 2015. The main source of revenue - fixed-line communication services to the population - decreased by 8.3% (to 12.7 billion rubles) against the backdrop of a decline in subscribers and traffic. Revenues from the provision of broadband Internet access services to individuals showed rapid growth, increasing by almost a quarter - to 3.9 billion rubles - against the backdrop of growing ARPU. Revenue from digital television increased by two thirds (903 million rubles), and revenue from mobile communications increased 4.5 times - to 424 million rubles. The dynamics of other articles was mixed.

Operating expenses increased by 5.4% - to 7.7 billion rubles against the backdrop of increased personnel costs and depreciation charges. As a result, operating profit decreased by almost 20% - to 2 billion rubles. Net financial income decreased by almost 30% due to a decrease in interest rates on financial investments and their volume. Let us remind you that MGTS does not have a debt load. As a result, the company's net profit decreased by 23.1% - to 2.4 billion rubles.

Based on the results of the published financial statements, we lowered our net profit forecast for 2017 and future years, reflecting the faster rate of decline in revenue from the provision of traditional services. The increase in potential profitability is associated with taking into account in our model the dividends recommended by the company’s Board of Directors, which exceed the net profit of 2016 by almost 2 times. Let us remind you that the payment per ordinary and preferred share can be 222 rubles. In our model, we also increased the forecast of dividend payments to 100% of net profit. Thus, according to our estimates, when finding the company’s net profit in 2017-2022. in the range of 9-9.5 billion rubles, the annual dividend can range from 92 to 100 rubles for both types of shares. At the same time, after paying dividends for 2016, the company will have financial investments worth 13 billion rubles, which can also be paid in the form of dividends.

We note that according to our estimates, slightly less than 1% of ordinary shares and about 28% of preferred shares are in free float. Both types of the company's shares are trading with a P/BV of about 1.4 and are not among our priorities.

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MGTS is an abbreviation that stands for Moscow City Telephone Network, which appeared back in the 19th century - 1882. Since then, the corporation has been regularly performing communication functions for residents of the Russian Federation - providing uninterrupted mobile and landline communications, providing access to the global Internet, offering video surveillance services, security monitoring and others. In 2016 and 2017, MTS can be considered one of the largest owners of shares with the opportunity to receive MGTS dividends, which owns almost 95 percent of their total amount. You can learn about how and where you can receive MGTS dividends, how they are paid in 2016-2017 and what is meant by preferred shares from the article below.

What are dividends

The name dividend is the profit that shareholders must receive when dividing their earnings. It is worth noting that payments that fall into the hands of shareholders are not a share of net profit - you can receive dividends on shares only after paying all costs - taxes, payments on preferred shares in the year of profit distribution. The latter, unlike ordinary papers, have special capabilities and limitations. A person who owns a preferred share has a primary and guaranteed right to receive dividends. However, it does not have a vote when voting at a meeting of all shareholders.

Payments of dividends on shares are made unevenly for each shareholder - profit can be obtained in a proportional calculation, where the size of the dividend is calculated in proportion to the percentage of the owner's shares. The company has the right not to pay dividends for one or several years.

MGTS - payments on shares for 2016 and 2017

According to information posted on economic forums and analytical materials, dividend payments on MGTS shares are breaking all sorts of records.

For ordinary securities

As of last year, 2016, the amount for the total distribution of dividend payments and preferred shares of MGTS and ordinary shares amounted to a large amount - more than twenty-two billion: 22,186,910,769 in domestic currency. Total - for one ordinary security, as well as for a preferred share, the number of dividends amounted to 233 rubles. This amount has increased significantly and was the largest among MGTS's payments to its shareholders over the last five years.

It is important to remember that the company reserves the right not to pay dividends on preferred and ordinary shares for one or more years if this improves the economic position of the company and increases turnover.

MGTS took advantage of this opportunity in 2011 and 2012. This led to the preservation and increase of profits and, consequently, to large dividend payments by MGTS for 2016.

To preferred shareholders

In 2017, no less active dividend payments to holders of preferred and ordinary shares are predicted. Thanks to news materials in information and specialized - economic - media disseminating information about MGTS's record dividends, the number of shares purchased from the city telephone company increased significantly. The outgoing 2017 promises to equally significantly replenish the budget of the owners of MGTS shares, not only preferred ones, but also ordinary shares. In 2016 and 2017, the main shareholder of MGTS was and remains the well-known cellular communications company - MTS.

How and where to receive dividends

A person who has purchased shares of any company is interested in knowing where it is possible to receive dividends? MGTS informs shareholders: dividend payments on shares are made at MTS Bank branches. There are many subsidiary offices in Moscow, where shareholders can easily receive dividends on shares in 2017.

Such branches are located, among other things, at the following addresses: Myasnitskaya Street, building 11; Autumn Boulevard, building 5, building 1; Leninsky Prospekt, building 45; Suschevsky Val, house 9, building 1 and others. More accurate information about office opening hours and their locations can be obtained by dialing the phone number: 88002500520 or 84957770001 at any time of the day.

Shareholders who wish to receive MGTS dividends in 2017 need to take into account the bank’s requirements and, when receiving a sum of money, present a number of documents confirming this right. When a shareholder independently applies to an institution, it is necessary to present a Russian passport.

The authorized person will be able to receive MGTS dividends using a power of attorney issued in advance by the bank or certified by a notary. The heirs of the shareholder can also apply for a power of attorney from a notary and a certificate of inheritance.

Conclusion

MGTS dividends are paid to shareholders in the manner established by the company and in compliance with tax legislation. In 2016, dividends on preferred shares and ordinary securities increased significantly - from 15.26 rubles to 233. The same phenomenon, according to forecasts, is expected in 2017. The question of where to receive dividends is easy to answer - at MTS Bank branches upon presentation of the package necessary documents - to apply in person and receive a profit, you must present a valid citizen’s passport. To receive payment to a trustee or heir, papers are prepared and certified by a notary in advance.

Cumulative dividends in the next 12m: 232 rub.(forecast)
Average dividend growth rate 3y: n/a
Upcoming dividends: 232 rub. (11.46% ) 11.07.2020 (forecast)

Total payments by year

All payments

Profit forecast next. 12m: 11880 million rubles.
Number of shares outstanding: 79.71 million pieces
Stability of payments: 0.71
Growth stability: 0.29

A comment:

MGTS maintains a stable cash flow and, without major investment projects, is able to pay significant dividends. At the end of 2015, we paid 100% of the profit for 2 years. Based on the results of 2016 and 2017, they also recommended dividends greater than annual profit, but the risk of irregular payments remains. Based on the results of 2018, it was again recommended to pay dividends significantly higher than the profit for the year.

Investment company DOKHOD, Joint Stock Company (hereinafter referred to as the Company) does not promise or guarantee the return on investments. Decisions are made by the investor independently. In preparing the materials contained on this page, information was used from sources that, in the opinion of Company specialists, are trustworthy. However, this information is intended solely for informational purposes, does not contain recommendations and is an expression of the private opinion of the Company’s analytical service specialists. Despite the care taken by the Company's specialists in compiling this page, the Company makes no guarantees regarding the accuracy or completeness of the information contained herein. No one should under any circumstances consider this information as an offer to enter into an agreement on the securities market or other legally binding action, either on the part of the Company or on the part of its specialists. Neither the Company nor its agents or affiliates accept any liability for any damages or expenses arising directly or indirectly from the use of this information. The information contained on the page is valid at the time of its publication, and the Company has the right to make any changes to the information at any time. The Company, its agents, employees and affiliates may, on occasion, engage in transactions in securities mentioned on this page or have relationships with the issuers of those securities. The results of investing in the past do not determine future income; the state does not guarantee the return on investment in securities. The Company cautions that dealing in securities involves various risks and requires appropriate knowledge and experience.

When forming the calculated indicators, the latest official closing prices of the relevant securities available as of the date of publication of the data, provided by the Moscow Exchange, are used.

The decrease is due to worsening financial results at the end of last year. However, dividends are close to record levels and the yield is attractive. The main risk is low liquidity.

The MGTS Board of Directors recommended that shareholders approve the payment of dividends based on the results of 2017 in the amount of almost 22 billion rubles. It is proposed to allocate 18.4 billion rubles, or 231 rubles, for payments on ordinary shares. per share with a current yield of 11.9%. For preferred ones - 3.6 billion rubles, or 231 rubles. per share with a current yield of 12.3%.

The shareholders meeting will take place on June 22. The closing date of the dividend register is July 12.

The company slightly lowered its dividends after two years of record payments: RUB 22.2 billion. in 2016 and just over 21 billion rubles. in 2015 (after the announcement of dividends for 2016 on May 15 last year, shares rose in price by 40% by the close of previous trading, and MGTS reached a historical maximum of 118.2 billion rubles). Before this, payments were much more modest: in 2013 and 2014 - 2.4 billion rubles. and 1.8 billion rubles. respectively (just over 10% of profit), and in 2011 and 2012 there were no payments at all. Dividends grew as capital expenditures were reduced as a result of the completion of the construction of a new GPON fiber-optic network in Moscow, as well as due to the need to satisfy the needs of the parent company, MTS (part of Vladimir Yevtushenkov's Sistema JSFC), for funds. This year, MTS again needs funds to support AFK.

Dividends remain close to record levels despite worsening financial performance for the second year in a row, which is typical for the telecommunications sector in general. Net profit under IFRS in 2017 decreased by 17%, revenue by 1%, pre-tax profit by 17.8%. The company's commercial, general and administrative expenses increased (by 8%), the positive effect from a decrease in long-term liabilities (-7.4% year-on-year) was offset by the negative effect from an increase in short-term liabilities (+13% year-on-year).

Is it worth investing?

MGTS securities on the Moscow Exchange are low-liquidity: less than 5% of shares are in free placement (the company is 95% owned by MTS, which is part of Vladimir Yevtushenkov’s Sistema JSFC, and its subsidiary Sistema-Inventure). At the auction on May 14, by 16:00 Moscow time, only 36 transactions were carried out on ordinary shares for 1.4 million rubles. Preferred shares have a higher turnover, although they cannot be called highly liquid: as of 16:00, 436 transactions were carried out on them for 30.5 million rubles.

An inexperienced investor risks a collapse in stock prices when trying to sell them. Investors pursuing long-term strategies should not allocate more than 5% of their investment portfolio to such stocks.

Overall, both the common and preferred shares are showing continued growth, as are the shares of its parent company. As of 16:00 Moscow time, ordinary shares of MGTS rose in price by 11% compared to the close of the previous main session; since the beginning of 2017, the increase was 43%. Preferred shares by 16:00 Moscow time grew by 10.2% compared to the close of previous trading; since the beginning of last year they have risen in price by almost 2.4 times.